If you have taken out a home loan mortgage to buy property and have found yourself in an unmanageable situation, there are loan programs offered by most lenders to assist you in getting your finances back within your grasp. One of these programs is called a mortgage modification. Mortgage modifications were created to help homeowners by lowering monthly payments and interest rates, by decreasing the length of term on a mortgage, or in some severe cases by negotiating reductions in the principal amount of the loan in order to assist homeowners in preventing foreclosure, making it in most cases the best option in regards to helping you keep your home.
When to Look Into Mortgage Modification
If you have a mortgage that is not in default or delinquent in payments, adjusting your mortgage by means of mortgage modification not produce optimum results. In fact, if you have no delinquent payments within the last year, attempting to or following through with a mortgage modification can actually adversely affect your credit rating. However:
- if you have been finding it difficult to make your monthly payments, and
- are at least 30 days late on your last or a previous payment,
receiving a mortgage modification will prevent you from seeing any negative effects on your credit rating, and most banks do not consider running a credit check in cases of mortgage modification.
How Long Your Mortgage Modification Will Take, and the Cost You Will Incur
Depending on your lender, your mortgage modification process on average will take anywhere from 2 to 4 weeks. Though the initial costs for a mortgage modification are specific to your lender as well, they are typically high, and must be paid with interest. It should be noted that since it is an easier option, a mortgage modification typically costs less than a loan refinancing. Also, you should be weary of any organization that charges a fee to handle negotiations of your loan with your lender.
Who You Should Contact Regarding Your Mortgage Modification
The first person you should contact when considering a mortgage modification is your original lender. They have all of your information and records of payment readily available, and recently most lenders began incorporating their own loan modification programs to assist troubled homeowners. Most lenders are more than willing to modify your mortgage to prevent foreclosure because they have entered into a government funded mortgage modification program as well.
Always contact your original lender before any non-profit organization or law firm, as they will require you to pay more than you need to spend. If your original lender refuses or cannot assist you, seek a licensed loan and mortgage modification organization in your state, and don’t seek their services unless they offer a written guarantee.
Getting Help
If you are facing an unmanageable home loan, you may wish to consult with an experienced foreclosure attorney who can provide you with assistance in determining how to negotiate with your bank to adjust your mortgage. Getting the help of an expert attorney in negotiating with your bank can be a great way to make sure you are able to get the best deal possible.
